IT MAY BE TIME TO RETHINK FLAT TAX FOR ALL AMERICANS

At its inception in 1913, the federal income tax was dubbed the "rich man's tax" largely because it applied to only 1 percent of Americans. How long ago that seems today. Over the decades, tax regulations, like the specialist lawyers and accountants who interpret them, have spread like crab grass in August. With bracket creep, fostered by the very inflation government causes, millions of middle-class Americans saw themselves moved into tax brackets that had been literally designed for millionaires. It was only in 1981, with Ronald Reagan's indexing of tax rates to account for inflation, that this windfall for government was halted.

Most Americans, even those without especially complex holdings or a business return to file, find themselves defeated by the tax code's complexity and forced to spend money on professional tax preparation help.

If Richard Army has his way, all this complexity would be swept away, and every American could file his or her income tax return on a postcard. For a year now, he has championed a radical reform known as the flat tax. This may have seemed like a pointless crusade before, but after Nov. 8, things changed radically. For Rep. Army is no longer just a congressman from Texas; he is the new majority leader, second in command in the House.

The idea is simple: all Americans would pay the same rate -- a flat 17 percent on income. Deductions? Only a few would remain: deductions for mortgage interest on your principal dwelling and for charitable contributions. All other income would be taxed at the 17 percent rate for all Americans.

In addition to its simplicity, other benefits, especially for families with children, the working poor and others at the low end of the income scale, are apparent. One writer summarizes this aspect of the Army proposal: "The personal allowance would be $13,100 for a single person, $17,200 for a single head of household and $26,200 for a married couple filing jointly. In addition, the allowance for each child would be increased to $5,300. The typical family of four, accordingly, would be taxed only on income in excess of $36,800. That would remove millions of poor families from the tax rolls entirely."

Still another aspect commends the Army flat-tax proposal. Rep. Army would eliminate the noxious practice of tax withholding from an employee's paycheck. This is one of government's most dishonest tricks: taking money you have earned before you have a chance to see it. Withholding has also been one of the most significant spurs of the growth of government. Eliminating withholding would restore some balance to the moral calculus.

If, after action within the first 100 days on the Republican "Contract With America," House leaders can turn their attention to passage of Rep. Armey's flat-tax proposal, the GOP will earn the thanks of grateful Americans. Simplicity, fairness and increased productivity will be enhanced. Legions of tax lawyers and accountants will be out of work, but we'll take that in the bargain. We're sure they can find more productive employment.